Buying More Palantir After Enterprise Extending Partnership
Plus, what we’re waiting on when it comes to shares of ServiceNow.
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| Symbol | Transaction Type | # Shares Traded | Recent Price $ | Shares Owned After Trade | % Portfolio |
|---|---|---|---|---|---|
PLTR | Buy | 60 | $139 | 1,265 | 3.3% |
After you receive this alert, the Pro Portfolio will buy 60 shares of Palantir (PLTR) at or near $139. Following the trade, the Portfolio will own 1,265 PLTR shares, roughly 3.3% of its assets.
Our message on Tuesday was that we could see those stock hit by the "SaaSpocalypse" rebound some in the near-term but, for a more meaningful rebound, the likely set of catalysts would be continued order strength as well as sequential gains for backlog, RPO and total contract values. We still see that being the case, but with that said, we are dipping our collective toes a bit further into Palantir shares on Wednesday morning.
Last week, we discussed Palantir’s growing relationship with Airbus (EADSY) and its expanded one with the Defense information Systems Agency. On Wednesday morning, we have a partnership announcement between Palantir and Rackspace (RXT) that will see Palantir’s software used in Rackspace’s Private Cloud and UK Sovereign data centers. The agreement will also extend Palantir’s reach into the enterprise community, leveraging Rackspace’s positioning when it comes to managing mission-critical enterprise workloads.
With the mention of “workloads,” you should also be thinking of ServiceNow (NOW) and its relationships with OpenAI and Anthropic.
So, why are we not also adding to the Portfolio’s position in NOW shares?
As we discussed on Tuesday, ServiceNow CEO Bill McDermott announced he will buy $3 million worth of stock next week and other insiders have suspended 10b5-1 related stock sales. The response? NOW shares still finished the day lower, which tells us our thinking that the market wants to see concrete evidence that AI isn’t eating away at its business is needed. That brings us back to our comment on Tuesday and above about order strength and sequential strength in backlog, RPOs and total contract values.
The announcements by Palantir point to further gains in those categories when Palantir reports its March quarter results sometime in late April or early May.
As we said on Tuesday, we will monitor upcoming investor conference agendas and other announcements. If we see ServiceNow follow Palantir’s lead and announce multiple new partnerships, that would be a big step in the right direction.
Normally, after the trade, we would adjust our panic point, however, we are putting the finishing touches on our updated Portfolio table that includes updated consensus EPS, RSI and other figures. When we publish that on Wednesday or Thursday, we will include an updated PLTR panic point and ones for other holdings as well.
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(Please note that we are looking to execute these trades at or near the share price mentioned above. Once the trade is completed, subscribers can see the trade's executed price here. Be sure to toggle the chart to sort by Purchase Date.)
At the time of publication, TheStreet Pro Portfolio was long NOW and PLTR.
